According to new data from provincially collected tax information, home purchases by foreign buyers have fallen. This is being attributed to Ontario’s non-resident speculation tax (NRST), which was introduced with the province’s Fair Housing Plan to charge foreign buyers a tax when purchasing a residential property in Ontario.
In a press release, the Ontario government states the tax is helping to address unsustainable demand in the Greater Golden Horseshoe. The data finds that from May 27, 2017 until August 18, 2017, foreign buyers accounted for 3.2 per cent of home purchases across the Greater Golden Horseshoe region, down from 4.7 per cent since the launch of Ontario’s Fair Housing Plan in the spring. In Toronto, foreign buyer transactions fell from 7.2 per cent to 5.6 per cent of all transactions during that same period.
The provincial government began collecting enhanced information as of April 24, 2017 to better understand local housing market trends. This additional requirement applies to anyone who purchases or acquires land containing up to six single family residences or agricultural land. Foreign buyers, individuals who are not citizens or permanent residents, or foreign corporations may be subject to the NRST.
“The measures that we introduced as part of the Fair Housing Plan are working – we are seeing increased housing supply and evidence that more people are finding affordable homes,” said Charles Sousa, Minister of Finance, in a press release. “Ontario continues to be a place that welcomes all new residents, drawn by its rising employment and strong economy.”